ON THE BRINK OF THE ABYSS
Another worrying factor is insurance: in times of crisis, increasing numbers of Italians decide to keep their cars off the road. In Italy, 12% of about 35 million private vehicle insurance policies have not been renewed. Specifically, a significant number of interviewees stated that in 2012/2013 they will leave their cars parked.
THE ESCALATION of the economic crisis in the automotive sector has been confirmed by data presented by Unasca, Anfia, Aniasa, Assilea, Federauto and Unrae. In a note to the political powers that support the Government, they explained the context and dynamics that characterize the automotive sector, Italy’s most important goods and services supply chain which accounts for 11.4% of GDP in revenues, 16.6% of tax contributions and employs 1,200,000 people both directly and in allied industries.
Following the downsizing that was consolidated in the 2008-2011 three-year period, when registrations in the car market fell from 2.5 to 1.7 million (-30%), operators in the entire supply chain – the associations explained – have dealt with the crisis and have made huge sacrifices by reorganizing their companies. Even so, this did not prevent many businesses from closing, in particular the small and mid-size distribution, components and services firms associated with the sale and circulation of vehicles, with the total waste of the considerable human and structural resources that distinguished the entrepreneurial fabric.
From the losses recorded in March (-26.7%), the fourth month in succession with two-figure negative results compared with the same months in 2011 (16.9% and 18.94% in January and February, respectively), it is expected that registrations for the whole of 2012 will not exceed 1,370,000, a further decline of 20%. Figures that pose a threat to entrepreneurism in the automotive industry as a whole, with market levels returning to those of the Eighties, without taking into account the annual losses from VAT and associated contributions that will be in the region of 2.5 billion euros.
Another worrying factor is insurance: in times of crisis, increasing numbers of Italians decide to keep their cars off the road. In Italy, 12% of about 35 million private vehicle insurance policies have not been renewed. Specifically, a significant number of interviewees stated that in 2012/2013 they will eliminate running costs by keeping their cars parked in private areas (garage or garden). In practice, out of one thousand clients insured to spring 2012, 71% declared that they had changed insurance company, either to save or because they were dissatisfied with the previous year’s service. 18% said that they had sold or written off their car, 11% declared that they still have a car but do not use it.
In such a grave context that is accentuated by tight credit, the government’s recent proposal to cover part of the labour bill by cutting deductions for using company cars, is totally bewildering not to mention incomprehensible. Instead, the supply chain’s associations maintain that it is crucial and urgent to give priority to an entire sector that has reached the threshold of non-sustainability and requires urgent intervention and specific fiscal revision. Vehicle and components manufacturers, dealerships, automobile consultancy services, leasing and rental companies are aware of the complexity of the Italian situation and the need to make sacrifices but, at the same time, they have a duty to appeal to political and legislative awareness and be able to count on meetings and discussions that focus on identifying concrete solutions that will revive the market and protect jobs.